APPENDIX B
THE REVEST VALUE FUND
PROSPECTUS - AUGUST 24, 1998
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NEW ACCOUNT AND GENERAL INFORMATION:
INVESTOR INFORMATION -- 1-800-277-5573
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SHAREHOLDER SERVICES -- 1-877-4REVEST (877-473-8378)
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INVESTMENT OBJECTIVES AND POLICIES
The REvest Value Fund (the "Fund") primarily seeks long-term growth and
secondarily current income by investing in a broadly diversified portfolio of
common stocks and convertible securities. Prospective portfolio investments are
selected on a value basis and are primarily limited to small and medium-sized
companies viewed by the Fund's investment adviser as having attractive financial
characteristics and/or "vitality factors." Vitality factors are those factors
(e.g., an active acquisition program, stock buy-back program and/or cost
reduction program) that should, in the investment adviser's judgment, allow a
company to build future, incremental value for shareholders. There can be no
assurance that the Fund will achieve its objectives.
The Fund is a no-load series of The Winter Harbor Fund (the "Trust"), a
diversified open-end management investment
company. The Trust is currently offering shares of only one series. The Fund's
predecessor, The REvest Growth & Income Fund, was a series of The Royce Fund.
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ABOUT THIS PROSPECTUS
This Prospectus sets forth concisely the information that you should know about
the Fund before you invest. It should be retained for future reference. A
"Statement of Additional Information" ("SAI"), containing further information
about the Fund and the Trust, has been filed with the Securities and Exchange
Commission. The SAI is dated August 24, 1998 and has been incorporated by
reference into this Prospectus. A copy of the SAI may be obtained without charge
by writing to the Trust or calling Investor Information.
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TABLE OF CONTENTS
PAGE
Fund Expenses B-2
Investment Performance B-2
Investment Objectives B-3
Investment Policies B-3
Investment Risks B-4
Investment Limitations B-4
Management of the Trust B-5
Year 2000 Disclosure B-7
Size Limitations B-7
General Information B-7
PAGE
Dividends, Distributions and Taxes B-8
Net Asset Value Per Share B-8
SHAREHOLDER GUIDE
Opening an Account and Purchasing Shares B-9
Additional Investments to Existing Accounts B-10
Choosing a Distribution Option B-10
Important Account Information B-11
Redeeming Your Shares B-12
Transferring Ownership B-13
Other Services B-14
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THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED ANY FUND'S SHARES AS AN
INVESTMENT OR DETERMINED WHETHER THIS PROSPECTUS IS ACCURATE OR COMPLETE. ANYONE
WHO TELLS YOU OTHERWISE IS COMMITTING A CRIME.
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A Series of The Winter Harbor Fund
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FUND EXPENSES
THE FUND IS NO-LOAD AND HAS NO 12B-1 FEES.
The following table illustrates all expenses and fees that you would incur as a
shareholder of the Fund.
SHAREHOLDER TRANSACTION EXPENSES
Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Redemption Fee:
1 Year or More After Account Opened None
Early Redemption Fee:
Less Than 1 Year After Account Opened 1.00%
ANNUAL FUND OPERATING EXPENSES
Management Fees 1.00%
Other Expenses 0.30%
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Total Operating Expenses 1.30%
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The adviser has agreed to limit the Fund's expense ratio to 1.30% through
December 31, 1999. The adviser and sub-adviser have agreed to waive fees, in
equal amounts, in order to maintain this expense ratio. For a further discussion
of these fees, see "Management of the Trust."
The purpose of the above table is to assist you in understanding the various
costs and expenses that you would bear directly or indirectly as an investor in
the Fund.
The following examples illustrate the expenses that you would incur on a $1,000
investment over various periods, assuming a 5% annual rate of return and
redemption at the end of each period.
1 YEAR 3 YEARS
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$13 $41
THESE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE HIGHER OR LOWER THAN THOSE
SHOWN.
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INVESTMENT PERFORMANCE
TOTAL RETURN IS THE CHANGE IN VALUE OVER A GIVEN PERIOD FOR A CONTINUOUS
SHAREHOLDER, ASSUMING REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS.
From time to time, the Fund may include in communications to current or
prospective shareholders figures reflecting total return over various time
periods. "Total return" is the rate of return on an amount invested in the Fund
from the beginning to the end of the stated period and assumes redemption at the
end of the period. "Average annual total return" is the annual compounded
percentage change in the value of an amount invested in the Fund from the
beginning until the end of the stated period.
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INVESTMENT OBJECTIVES
The Fund primarily seeks long-term growth and secondarily current income by
investing in a broadly diversified portfolio of common stocks and convertible
securities. Prospective portfolio investments are selected on a value basis and
are primarily limited to small and medium-sized companies viewed by the Fund's
investment adviser as having attractive financial characteristics and/or
"vitality factors." Vitality factors are those factors (e.g., an active
acquisition program, stock buy-back program and/or cost reduction program) that
should, in the investment adviser's judgment, allow a company to build future,
incremental value for shareholders. Since certain risks are inherent in owning
any security, there can be no assurance that the Fund will achieve its
objectives.
The investment objectives of primarily long-term growth and secondarily current
income are fundamental and may not be changed without the approval of a majority
of the Fund's voting shares, as that term is defined in the Investment Company
Act of 1940 (the "1940 Act").
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INVESTMENT POLICIES
THE FUND INVESTS ON A "VALUE" BASIS.
Ebright Investments, Inc. (formerly named Royce, Ebright & Associates, Inc.),
the Fund's investment adviser, uses a "value" method in managing the Fund's
assets. In its selection process, Ebright Investments, Inc. ("EII") considers a
company's cash flows, its balance sheet quality, an understanding of various
internal returns indicative of profitability and its growth prospects in trying
to relate such factors to the price of a given security. With regard to each
portfolio security in which the Fund invests, EII seeks to identify a "valuation
discrepancy" between the security's then current market price and its "business
worth," that is, what a knowledgeable buyer would pay for the entire company,
based on an appraisal of its financial characteristics and/or growth prospects.
After this appraisal of value process is completed, EII then, in addition, seeks
to identify and evaluate "vitality factors," which are those characteristics of
a portfolio company that should result in the building of future value for
shareholders. Examples of such "vitality factors" include research and
development efforts, new products, new market development efforts, the
redeployment of underutilized assets, an active acquisition program, stock
buy-back program, cost reduction program and investments in new technologies or
processes.
The portfolio, therefore, is a collection of securities that EII believes have
all been purchased at a discount to their real "business worth" and possess, in
addition, "vitality factors" that should allow them to build future incremental
value for shareholders. EII believes that profits can come both from the
continued success and growth of each portfolio company as well as the eventual
elimination of each security's valuation discrepancy.
THE FUND INVESTS PRIMARILY IN SMALL AND MEDIUM-SIZED COMPANIES.
EII believes that there are many high quality companies in the "small-cap" and
"mid-cap" sectors that have above average growth prospects but are not widely
followed or understood by investors. EII seeks to identify and invest in such
companies when their securities can be purchased at appropriate discounts to
EII's assessment of their "business worth."
In accordance with its objectives of seeking primarily long-term growth
(realized and unrealized) and secondarily current income, the Fund will normally
invest at least 90% of its assets in common stocks, convertible preferred stocks
and convertible bonds. At least 80% of these allowable securities will be
income-producing, and at least 80% of allowable securities will be issued by
companies with stock market capitalizations between $200 million and $2 billion
at the time of investment. The Fund will normally have a weighted average market
capitalization size in excess of $500 million. The remainder of the Fund's
assets may be invested in securities with lower or higher market
B-3
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capitalizations, non-dividend paying common stocks and non-convertible fixed
income securities. The securities in which the Fund invests may be traded on
securities exchanges or in the over-the-counter market. While most of the Fund's
securities will be income-producing, the composite yield of the Fund's
securities may be either higher or lower than the composite yield of the stocks
in the S&P 500 Index.
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INVESTMENT RISKS
THE FUND IS SUBJECT TO CERTAIN INVESTMENT RISKS.
As a mutual fund investing primarily in common stocks and/or securities
convertible into common stocks, the Fund is subject to market risk, that is, the
possibility that common stock prices will decline over short or even extended
periods. The Fund may invest in securities of companies that are not well-known
to the investing public, may not have significant institutional ownership and
may have cyclical, static or only moderate growth prospects. The stocks of such
companies may be more volatile in price and have lower trading volumes than the
larger capitalization stocks included in the S&P 500 Index. Accordingly, EII's
investment method requires a long-term investment horizon. The Fund should not
be used by "market timers."
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INVESTMENT LIMITATIONS
The Fund has adopted a number of fundamental investment policies, designed to
reduce its exposure to specific situations, which may not be changed without the
approval of a majority of its outstanding voting shares, as that term is defined
in the 1940 Act. These policies are set forth in the Statement of Additional
Information and provide, among other things, that the Fund will not:
(1) with respect to 75% of its assets, invest more than 5% of its assets in
the securities of any one issuer (excluding obligations of the U.S.
Government), or acquire more than 10% of the outstanding voting
securities of any one issuer;
(2) invest more than 25% of its assets in any one industry; or
(3) invest in companies for the purpose of exercising control of management.
OTHER INVESTMENT PRACTICES:
In addition to investing primarily in the equity and fixed income securities
described above, the Fund may follow a number of additional investment
practices.
SHORT-TERM FIXED INCOME SECURITIES:
The Fund may invest in short-term fixed income securities for temporary
defensive purposes, to invest uncommitted cash balances or to maintain liquidity
to meet shareholder redemptions. These securities consist of United States
Treasury bills, domestic bank certificates of deposit, high-quality commercial
paper and repurchase agreements collateralized by U.S. Government securities. In
a repurchase agreement, a bank sells a security to the Fund at one price and
agrees to repurchase it at the Fund's cost plus interest within a specified
period of seven or fewer days. In these transactions, which are, in effect,
secured loans by the Fund, the securities purchased by the Fund will have a
value equal to or in excess of the value of the repurchase agreement and will be
held by the Fund's custodian bank until repurchased. Should the Fund implement a
temporary defensive investment policy, its investment objectives may not be
achieved.
B-4
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FOREIGN SECURITIES
The Fund may invest up to 5% of its net assets in debt and/or equity securities
of foreign issuers. Foreign investments involve certain risks, such as political
or economic instability of the issuer or of the country of issue, fluctuating
exchange rates and the possibility of imposition of exchange controls. These
securities may also be subject to greater fluctuations in price than the
securities of U.S. corporations, and there may be less publicly available
information about their operations. Foreign companies may not be subject to
accounting standards or governmental supervision comparable to U.S. companies,
and foreign markets may be less liquid or more volatile than U.S. markets and
may offer less protection to investors such as the Fund.
LOWER-RATED DEBT SECURITIES
The Fund may also invest no more than 5% of its net assets in lower-rated
(high-risk) non-convertible debt securities, which are below investment grade.
The Fund does not expect to invest in non-convertible debt securities that are
rated lower than Caa by Moody's Investors Service, Inc. or CCC by Standard &
Poor's Corporation or, if unrated, determined to be of comparable quality.
PORTFOLIO TURNOVER
Although the Fund generally seeks to invest for the long term, it retains the
right to sell securities regardless of how long they have been held. Higher
portfolio turnover rates would increase the Fund's transaction costs, including
brokerage commissions.
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MANAGEMENT OF THE TRUST
INVESTMENT ADVISER
The Trust's business and affairs are managed under the direction of its Board of
Trustees. Ebright Investments, Inc. ("EII"), the Fund's investment adviser, is
responsible for the management of the Fund's portfolio of investments, subject
to the authority of the Board of Trustees. EII, located at 511 Congress Street,
Portland, Maine, is an independent investment advisory firm, founded in 1994 and
registered as an investment adviser with the Securities and Exchange Commission.
EII was formerly known as Royce, Ebright & Associates, Inc. EII was the
investment adviser to The REvest Growth & Income Fund, which commenced
operations as a series of The Royce Fund on August 1, 1994. Subject to
shareholder approval, after a reorganization currently scheduled to occur on
September 25, 1998, The REvest Growth & Income Fund will cease to be a series of
The Royce Fund and will be reorganized into the Fund as the sole series of the
Trust. This reorganization will consist of the transfer of all of the assets of
The REvest Growth & Income Fund to the Fund in exchange solely for shares of
beneficial interest of the Fund, the assumption by the Fund of all of the
liabilities of The REvest Growth & Income Fund, and the distribution of shares
of the Fund to shareholders of The REvest Growth & Income Fund upon liquidation
of The REvest Growth & Income Fund.
The Fund's portfolio is managed by Jennifer E. Goff, President of EII. She has
been a director and a shareholder of EII since its inception. Jennifer succeeded
her father, Thomas R. Ebright, as President when Mr. Ebright passed away in
1997. Prior to assuming the office of President, Ms. Goff was Vice President and
Assistant Portfolio Manager. During the last five years, Ms. Goff has worked
full-time as a security analyst at Royce & Associates, Inc. (formerly Quest
Advisory Corp.) and completed her graduate studies in Finance at Columbia
University (M.B.A. `96). While Ms. Goff is responsible for EII's investment
management activities, EII has entered into a sub-advisory agreement with Gouws
Capital Management, Inc. to share resources in growing and managing the Fund.
B-5
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As compensation for its services to the Fund, EII is entitled to receive
advisory fees equal to 1.00% per annum of the first $50 million of the Fund's
average net assets and 0.75% per annum of any additional average net assets over
$50 million. These fees are payable monthly from the assets of the Fund. For
1997, the fees paid to EII by The REvest Growth & Income Fund were 1.00% of its
average net assets.
INVESTMENT SUB-ADVISER
EII has retained Gouws Capital Management, Inc. ("GCMI") to provide investment
sub-advisory and marketing support services to the Fund. GCMI, located at 511
Congress Street, Portland, Maine, is an independent investment advisory firm,
founded in 1984 and registered as an investment adviser with the Securities and
Exchange Commission. GCMI's principal and President, Johann H. Gouws, is not
engaged in any other business or profession other than his involvement in
establishing Acadia Trust, N.A. ("AT"), an affiliated trust company. GCMI
provides investment advisory services to AT, who acts as a custodian for GCMI's
approximately $1 billion in client assets. GCMI has a value orientation and
emphasizes in-depth fundamental analysis and company visitation similar to EII.
Although EII alone will determine the investments that will be purchased,
retained or sold by the Fund, GCMI will assist EII in such determinations. GCMI
will also, at the direction of EII, be responsible for placing purchase and sell
orders for investments with broker-dealers, and for other related transactions.
GCMI has agreed to provide services in accordance with the Fund's investment
objectives, policies and restrictions.
As compensation for its services to the Fund, GCMI is entitled to receive
sub-advisory fees from EII equal to one-half the net profit (net profit shall
mean the advisory fee paid to EII minus all of EII's expenses, including Ms.
Goff's salary and benefits and the preferential distribution equal to Ms. Goff's
salary and benefits paid to GCMI). Concurrent with the reorganization of the
Fund and as compensation for their part in AT's paying half the expenses
incurred in the reorganization, two of the principals of AT, Johann H. Gouws and
Richard E. Curran, Jr. will receive forty-eight percent (48%) of the outstanding
voting common stock of EII. Ms. Goff and her sister, Ellen E. Carlton, will own
the remaining fifty-two percent (52%) of the outstanding voting common stock of
EII.
ADMINISTRATOR
Countrywide Fund Services, Inc. ("Countrywide") located at 312 Walnut Street,
21st Floor, Cincinnati, Ohio 45202, serves as administrator to the Fund.
Countrywide is a wholly-owned indirect subsidiary of Countrywide Credit
Industries, Inc., a New York Stock Exchange listed company principally engaged
in the business of residential mortgage lending. As compensation, the Trust
shall pay Countrywide a monthly fee at the annual rate of .09% of the Fund's
average daily net assets up to $100 million; .075% of such assets from $100
million to $200 million; and .05% of such assets in excess of $200 million.
However, Countrywide shall be paid at least $2,000 per month for its services
for each series of the Fund.
DISTRIBUTION
CW Fund Distributors, Inc. ("CW Fund") located at 312 Walnut Street, 21st Floor,
Cincinnati, Ohio 45202, acts as distributor of the Fund's shares. EII may pay,
to unaffiliated broker-dealers, financial institutions or other service
providers who introduce investors to the Fund and/or provide certain
administrative services to those of their customers who are Fund shareholders,
up to .25% of the assets invested in the Fund by their customers. Compensation
paid in connection with such programs may include payments from the Fund for
certain shareholder-related services being provided to the Fund. When shares of
the Fund are purchased in this way, the service provider, rather than its
customer, may be the shareholder of record of the Fund's shares. Investors
should read the program materials provided by the service provider, including
information regarding fees which may be charged, in conjunction with this
Prospectus. Certain shareholder servicing features of the Fund may not be
available or may be modified in connection with the program of services offered.
B-6
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BROKERAGE ALLOCATION
EII selects the brokers who execute the purchases and sales of the Fund's
portfolio securities and may have orders placed with brokers who provide
brokerage and research services to EII. EII and GCMI are authorized, in
recognition of the value of brokerage and research services provided, to pay
commissions to a broker in excess of the amounts which another broker might have
charged for the same transaction.
CUSTODIAN
The custodian for the securities, cash and other assets of the Fund is Star
Bank, N.A.
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YEAR 2000 DISCLOSURE
Like other mutual funds, financial and other business organizations and
individuals around the world, the Fund could be adversely affected if the
computer systems used by EII and other service providers to the Fund do not
properly process and calculate date-related information and data from and after
January 1, 2000. EII and the administrator are taking steps to address the Year
2000 issue with respect to the computer systems that they use and to obtain
reasonable assurances that comparable steps are being taken by the Fund's other
major service providers. There can be no assurance, however, that these steps
will be sufficient to avoid adverse impact on the Fund from this problem.
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SIZE LIMITATIONS
If the Fund's assets total $350 million or more on December 31 of any year, then
the Fund will, commencing on March 1 of the next year, cease selling shares to
any new investors and will not resume selling its shares to new investors unless
and until its assets total $250 million or less on the last day of any
subsequent calendar quarter, in which case it may resume sales to new investors
on the first day of the next calendar quarter and continue them subject to the
$350 million limitation. Shareholders at the time of closure will be able to
purchase new shares after the Fund has closed.
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GENERAL INFORMATION
The Winter Harbor Fund (the "Trust") is a Delaware business trust registered
with the Securities and Exchange Commission as an open-end, diversified
management investment company. The Trustees have the authority to issue an
unlimited number of shares of beneficial interest, without shareholder approval,
and these shares may be divided into an unlimited number of series. Shareholders
are entitled to one vote per share. Shares vote by individual series on all
matters, except that shares are voted in the aggregate and not by individual
series when required by the 1940 Act and that if the Trustees determine that a
matter affects only one series, then only shareholders of that series are
entitled to vote on that matter.
Meetings of shareholders will not be held except as required by the 1940 Act or
other applicable law. A meeting will be held to vote on the removal of a Trustee
or Trustees of the Trust if requested in writing by the holders of not less than
10% of the outstanding shares of the Trust.
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B-7
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DIVIDENDS, DISTRIBUTIONS AND TAXES
The Fund pays dividends from net investment income quarterly and distributes its
net realized capital gains annually in December. Dividends and distributions
will be automatically reinvested in additional shares of the Fund unless the
shareholder chooses otherwise.
Shareholders will receive information annually as to the tax status of
distributions made by the Fund for the calendar year. For Federal income tax
purposes, all distributions by the Fund are taxable to shareholders when
declared, whether received in cash or reinvested in shares. Distributions paid
from the Fund's net investment income and short-term capital gains are taxable
to shareholders as ordinary income dividends. A portion of the Fund's dividends
may qualify for the corporate dividends-received deduction, subject to certain
limitations. The portion of the Fund's dividends qualifying for such deduction
is generally limited to the aggregate taxable dividends received by the Fund
from domestic corporations. Distributions paid from long-term capital gains of
the Fund are treated as long-term capital gains, regardless of how long the
shareholder has held Fund shares.
If a shareholder disposes of shares held for six months or less at a loss, such
loss will be treated as a long-term capital loss to the extent of any long-term
capital gains reported by the shareholder with respect to such shares. A loss
realized on a taxable disposition of Fund shares may be disallowed to the extent
that additional Fund shares are purchased (including by reinvestment of
distributions) within 30 days before or after such disposition.
The redemption of shares is a taxable event, and a shareholder may realize a
capital gain or capital loss. The Fund will report to redeeming shareholders the
proceeds of their redemptions. However, because the tax consequences of a
redemption will also depend on the shareholder's basis in the redeemed shares
for tax purposes, shareholders should retain their account statements for use in
determining their tax liability on a redemption.
At the time of a shareholder's purchase, the Fund's net asset value may reflect
undistributed income or capital gains. A subsequent distribution of these
amounts by the Fund will be taxable to the shareholder even though the
distribution economically is a return of part of the shareholder's investment.
The Fund is required to withhold 31% of taxable dividends, capital gains
distributions and redemptions paid to non-corporate shareholders who have not
complied with Internal Revenue Service taxpayer identification regulations.
Shareholders may avoid this withholding requirement by certifying on the Account
Application Form their proper Social Security or Taxpayer Identification Number
and certifying that they are not subject to backup withholding.
The discussion of Federal income taxes above is for general information only.
The Statement of Additional Information includes an additional description of
Federal income tax aspects that may be relevant to a shareholder. Shareholders
may also be subject to state and local taxes on their investment. Investors
should consult their own tax advisers concerning the tax consequences of an
investment in the Fund.
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NET ASSET VALUE PER SHARE
Net asset value per share (NAV) is determined as of the close of regular trading
on the New York Stock Exchange (normally 4:00 p.m., Eastern Time) on each day it
is open for business. The New York Stock Exchange is normally closed on the
following days: New Year's Day, Martin Luther King, Jr. Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas. Fund shares are purchased and redeemed at their net asset value per
share next determined after an order is received by the Fund's transfer agent.
The net asset value per share is determined by dividing the total value of the
Fund's investments and other assets, less any liabilities, by the number of
outstanding shares of the Fund.
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<PAGE>
In determining net asset value, securities listed on an exchange or the Nasdaq
National Market System are valued on the basis of the last reported sale price
prior to the time the valuation is made or, if no sale is reported for that day,
at their bid price for exchange-listed securities and at the average of their
bid and ask prices for Nasdaq securities. Quotations are taken from the market
where the security is primarily traded. Other over-the counter securities for
which market quotations are readily available are valued at their bid price.
Securities for which market quotations are not readily available are valued at
their fair value under procedures established and supervised by the Board of
Trustees. Bonds and other fixed income securities may be valued by reference to
other securities with comparable ratings, interest rates and maturities, using
established independent pricing services.
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SHAREHOLDER GUIDE
OPENING AN ACCOUNT AND PURCHASING SHARES
The Fund's shares are offered on a no-load basis. To open a new account, other
than an IRA or 403(b)(7) account, either by mail, by wire or through
broker-dealers, simply complete and return the Account Application. Separate
forms must be used for opening IRA's or 403(b)(7) accounts; please call Investor
Information at 1-800-277-5573 if you need these forms. Please indicate the
amount you wish to invest. Your initial purchase must be at least $2,000 except
for IRA's and accounts establishing an Automatic Investment Plan, which have
$500 minimums. If you need assistance with the Account Application Form or have
any questions about the Fund, please call Investor Information at
1-800-277-5573.
Subsequent investments may be made by mail, wire, or Automatic Investment (a
system of electronic funds transfer from your bank account), or Direct Deposit.
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PURCHASING BY MAIL:
Complete and sign the enclosed Account Application Form
NEW ACCOUNT
Please include the amount of your initial investment on the Application Form,
make your check payable to "The REvest Value Fund", and mail to:
The REvest Value Fund
P.O. Box 5354
Cincinnati, OH 45201-5354
For express or registered mail, send to:
The REvest Value Fund
312 Walnut Street
21st Floor
Cincinnati, OH 45202
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ADDITIONAL INVESTMENTS TO EXISTING ACCOUNTS
Additional investments should include the Invest-by-Mail remittance form
attached to your Fund confirmation statements. Please make your check payable to
"The REvest Value Fund", write your account number on your check and, using the
return envelope provided, mail to the address indicated on the Invest-by-Mail
form.
All written requests should be mailed to one of the addresses indicated for new
accounts.
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PURCHASING BY WIRE:
BEFORE WIRING: Please contact Shareholder Services at 1-877-4REVEST for wiring
instructions. To ensure proper receipt, please be sure your bank includes the
name of the Fund and your order number or account number. If you are opening a
new account, you must call Shareholder Services, complete the Account
Application Form and mail it to the "New Account" address above after completing
your wire arrangement. Note: Federal Funds wire purchase orders will be accepted
only when the Fund and Custodian are open for business.
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PURCHASING BY AUTOMATIC INVESTMENT:
The Automatic Investment Plan allows you to make regular, automatic transfers
($50 minimum) from your bank account to purchase shares in your Winter Harbor
Fund account on the 15th or last day of the month. To establish the Automatic
Investment Plan, please provide the appropriate information on the Account
Application Form and ATTACH A VOIDED CHECK.
PURCHASING BY DIRECT DEPOSIT
The Payroll Direct Deposit Plan and Government Direct Deposit Plan let you have
investments ($50 minimum) made from your net payroll or government check into
your existing Winter Harbor Fund account each pay period. Your employer must
have direct deposit capabilities through ACH (Automated Clearing House)
available to its employees. You may terminate participation in these programs by
giving written notice to your employer or government agency, as appropriate. The
Fund is not responsible for the efficiency of the employer or government agency
making the payment or any financial institution transmitting payments.
To initiate a Direct Deposit Plan, you must complete an Authorization for Direct
Deposit form, which may be obtained from Investor Information by calling
1-800-277-5573.
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CHOOSING A DISTRIBUTION OPTION
You may select one of three distribution options:
1. Automatic Reinvestment Option: Both net investment income dividends and
capital gains distributions will be reinvested in additional Fund
shares. This option will be selected for you automatically unless you
specify one of the other options.
2. Cash Dividend Option: Your dividends will be paid in cash and your
capital gains distributions will be reinvested in additional Fund
shares.
B-10
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3. All Cash Option: Both dividends and capital gains distributions will be paid
in cash.
You may change your option by calling Shareholder Services at 1-877-4REVEST.
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IMPORTANT ACCOUNT INFORMATION
The easiest way to establish optional services on your account is to select the
options you desire when you complete your Account Application Form. If you want
to add shareholder options later, you may need to provide additional information
and a signature guarantee. Please call Shareholder Services at 1-877-4REVEST for
further assistance.
SIGNATURE GUARANTEES
For our mutual protection, we may require a signature guarantee on certain
written transaction requests. A signature guarantee verifies the authenticity of
your signature and may be obtained from banks, brokerage firms and any other
guarantor that our transfer agent deems acceptable. A signature guarantee cannot
be provided by a notary public.
BROKER/DEALER PURCHASES
If you purchase Fund shares through a registered broker-dealer or investment
adviser, the broker-dealer or adviser may charge a service fee.
TELEPHONE TRANSACTIONS
Neither the Fund nor its transfer agent will be liable for following
instructions communicated by telephone that are reasonably believed to be
genuine. The transfer agent uses certain procedures to confirm that telephone
instructions are genuine, which may include requiring some form of personal
identification prior to acting on the instructions, providing written
confirmation of the transaction and/or recording incoming calls, and if it does
not follow such procedures, the Fund or the transfer agent may be liable for any
losses due to unauthorized or fraudulent instructions.
NONPAYMENT
If your check or wire does not clear, the transaction will be canceled and you
will be responsible for any loss the Fund incurs. If you are already a
shareholder, the Fund can redeem shares from any identically registered account
in the Fund as reimbursement for any loss incurred.
TRADE DATE FOR PURCHASES
Your trade date is the date on which share purchases are credited to your
account. If your purchase is made by check or Federal Funds wire and is received
by the close of regular trading on the New York Stock Exchange (generally 4:00
p.m., Eastern time), your trade date is the date of receipt. If your purchase is
received after the close of regular trading on the Exchange, your trade date is
the next business day. Your shares are purchased at the net asset value
determined on your trade date.
In order to prevent lengthy processing delays caused by the clearing of foreign
checks, the Fund will accept only a foreign check which has been drawn in U.S.
dollars and has been issued by a foreign bank with a United States correspondent
bank.
The Trust reserves the right to suspend the offering of Fund shares to new
investors. The Trust also reserves the right to reject any specific purchase
request.
- --------------------------------------------------------------------------------
B-11
<PAGE>
REDEEMING YOUR SHARES
You may redeem any portion of your account at any time. You may request a
redemption in writing or by telephone. Redemption proceeds normally will be sent
within two business days after the receipt of the request in Good Order.
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REDEEMING BY MAIL
Requests should be mailed to: The REvest Value Fund, P.O. Box 5354, Cincinnati,
OH 45201-5354. (For express or registered mail, send your request to: The REvest
Value Fund, 312 Walnut Street, 21st Floor, Cincinnati, OH 45202). The redemption
price of shares will be their net asset value next determined after the Transfer
Agent has received all required documents in Good Order.
DEFINITION OF GOOD ORDER
Good Order means that the request includes the following:
1. The account number and Fund name.
2. The amount of the transaction (specified in dollars or shares).
3. Signatures of all owners exactly as they are registered on the account.
4. Signature guarantees if either the value of the shares being redeemed
exceeds $25,000 or if the payment is to be sent to an address other
than the address of record or is to be made to a payee other than the
shareholder.
5. Other supporting legal documentation that might be required, in the
case of retirement plans, corporations, trusts, estates and certain
other accounts.
If you have any questions about what is required as it pertains to your request,
please call Shareholder Services at 1-877-4REVEST.
REDEEMING BY TELEPHONE
Shareholders who have not established Automatic Withdrawal may redeem up to
$25,000 of their Fund shares by telephone, provided the proceeds are mailed to
their address of record. To redeem shares by telephone, you or your
pre-authorized representative may call Shareholder Services at 1-877-4REVEST.
Redemption requests received by telephone prior to the close of regular trading
on the New York Stock Exchange (generally 4:00 p.m., Eastern time) are processed
on the day of receipt; redemption requests received by telephone after the close
of regular trading on the Exchange are processed on the business day following
receipt. Telephone redemption service is not available for Trust-sponsored
retirement plan accounts. Telephone redemptions will not be permitted for a
period of sixty days after a change in the address of record.
See also "Important Account Information - Telephone Transactions".
REDEEMING BY AUTOMATIC WITHDRAWAL
If you select the Automatic Withdrawal option, shares will be automatically
redeemed from your Fund account and the proceeds transferred to your bank
account according to the schedule you have selected. You must have at least
$25,000 in your Fund account to establish the Automatic Withdrawal option.
B-12
<PAGE>
REDEEMING BY WIRE
The Wire Redemption option lets you redeem up to $25,000 of shares from your
Fund account by telephone and transfer the proceeds directly to your bank
account. You may elect Wire Redemptions on the Account Application Form or call
Shareholder Services at 1-877-4REVEST for further assistance. There may be a
charge from the Transfer Agent and/or your bank for this service.
IMPORTANT REDEMPTION INFORMATION
If you are redeeming shares recently purchased by check or Automatic Investment
Plan, the proceeds of the redemption may not be sent until payment for the
purchase is collected, which may take up to fifteen calendar days. Otherwise,
redemption proceeds must be sent to you within seven days of receipt of your
request in Good Order.
If you experience difficulty in making a telephone redemption during periods of
drastic economic or market changes, your redemption request may be made by
regular or express mail. It will be processed at the net asset value next
determined after your request has been received by the Transfer Agent in Good
Order. The Trust reserves the right to revise or terminate the telephone
redemption privilege at any time.
The Trust may suspend the redemption right or postpone payment at times when the
New York Stock Exchange is closed or under any emergency circumstances as
determined by the Securities and Exchange Commission.
Although redemptions have always been made in cash, the Fund may redeem in kind
under certain circumstances.
EARLY REDEMPTION FEE
In order to discourage short-term trading, an early redemption fee of 1% of the
net asset value of the shares being redeemed is imposed if a shareholder redeems
shares of the Fund less than one year after becoming a shareholder. The fee is
payable to the Fund out of the redemption proceeds otherwise payable to the
shareholder and is used to offset the costs associated with redemptions. No
redemption fee will be payable by shareholders who are (1) employees or
representatives of the Trust or EII or members of their immediate families or
employee benefit plans for them, (2) participants in the Automatic Withdrawal
Plan, (3) certain Trust-approved Group Investment Plans and charitable
organizations, or (4) omnibus and other similar account customers of certain
Trust-approved broker-dealers and other institutions.
MINIMUM ACCOUNT BALANCE REQUIREMENT
Due to the relatively high cost of maintaining smaller accounts, the Trust
reserves the right to involuntarily redeem shares in any Fund account that falls
below the minimum initial investment due to redemptions by the shareholder. If
at any time the balance in an account does not have a value at least equal to
the minimum initial investment or if an Automatic Investment Plan is
discontinued before an account reaches the minimum initial investment that would
otherwise be required, you may be notified that the value of your account is
below the Fund's minimum account balance requirement. You would then have sixty
days to increase your account balance before the account is liquidated. Proceeds
would be promptly paid to the shareholder.
TRANSFERRING OWNERSHIP
You may transfer the ownership of any of your Fund shares to another person by
writing to: Countrywide Fund Services, Inc., P.O. Box 5354, Cincinnati, OH
45201-5354. The request must be in Good Order (see "Redeeming Your Shares -
Definition of Good Order"). Before mailing your request, please contact
Shareholder Services (1-877-4REVEST) for full instructions.
B-13
<PAGE>
OTHER SERVICES
For more information about any of these services, please call Investor
Information at 1-800-277-5573.
STATEMENTS AND REPORTS
A statement will be sent to you each time you have a transaction in your account
and quarterly. Financial reports will be mailed semi-annually. To reduce
expenses, only one copy of most shareholder reports may be mailed to a
household. Please call Investor Information if you need additional copies.
TAX-SHELTERED RETIREMENT PLANS
Shares of the Fund are available for purchase in connection with certain types
of tax-sheltered retirement plans, including Individual Retirement Accounts
(IRA's) for individuals and 403(b)(7) Plans for employees of certain tax-exempt
organizations.
These plans should be established with the Trust only after an investor has
consulted with a tax adviser or attorney. Information about the plans and the
appropriate forms may be obtained from Investor Information at 1-800-277-5573.
B-14
<PAGE>
THE WINTER HARBOR FUND
511 Congress Street
Portland, Maine 04101
INVESTMENT ADVISER:
Ebright Investments, Inc.
Jennifer E. Goff, President
511 Congress Street
Portland, Maine 04101
INVESTMENT SUB-ADVISER:
Gouws Capital Management, Inc.
511 Congress Street
Portland, Maine 04101
DISTRIBUTOR:
CW Fund Distributors, Inc.
P.O. Box 5354
Cincinnati, OH 45201-5354
TRANSFER AGENT:
Countrywide Fund Services, Inc.
P.O. Box 5354
Cincinnati, OH 45201-5354
CUSTODIAN:
Star Bank, N.A.
425 Walnut Street
Cincinnati, OH 45202
OFFICERS OF THE TRUST:
Jennifer E. Goff, President
Robert G. Dorsey, Vice President
Mark J. Seger, Treasurer
John F. Splain, Secretary
Tina D. Hosking, Assistant Secretary
Brian J. Manley, Assistant Secretary
REVEST VALUE FUND
A SERIES OF THE WINTER HARBOR FUND
